Bitcoin Is Soaring On Unprecedented Burst In Chinese Buying

Tyler Durden's picture

Last September (when bitcoin was trading at $230) we said that "As China Scrambles To Enforce Capital Controls, This Is Great News For Bitcoin" and that it is only a matter of time before Chinese buyers figure out that in a world in which the freeflow of capital out of China is increasingly more suppressed and where physical gold is actively being stored in China but is next to impossible to get it out of the country, it is only a matter of time before bitcoin explodes as China's bubble berserk population scrambles to buy.

One month ago, we showed a chart according to which it was almost time for the bitcoin breakout, in "Is Bitcoin About To Soar?" At the time bitcoin was trading in the low $400s.

Then, just yesterday, something snapped, and as we reported "Bitcoin Surges To 2016 Highs On Rising Chinese Demand."

It is unclear if that something is fears about an imminent round of Chinese devaluation following Friday's dramatic move higher in the US Dollar, something we also hinted at on Friday afternoon...

... or simply because China's $30 trillion in deposits had finally found the most efficient way to get their funds out of the country.

Whatever the reason, moments ago - as we expected - bitcoin finally broke out of its long-term range, and was trading at $520 moments ago on Coinbase...

... the highest price it has hit since the summer of 2014.

 

What is the reason for this dramatic move higher? It appears to be coming out of China, because moments ago Bitcoin traded in CNY on the Huobi exchange soared as high as 3820, or over $580, implying a massive local-demand driven arb to the US price of "only" $520.

It looks like the Chinese have finally awoken to bitcoin, just as we expected them to last September, when the price of bitcoin was over 50% lower.

With bitcoin now 100% higher than when we first said China would send it soaring,and 15% higher in the past two days, why do we remain in the bullish camp? Simple: China has $30 trillion in deposits - which concerns about devaluations will make very "flighty" while the market cap of bitcoin is under $8 billion. If Chinese depositors have finally figured out to use bitcoin to get their funds out of the country, watch out BTC shorts.

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God's picture

Soros has shown the world already how easy it is to own and control a currency.

You think the Israeli owners of Bitcoin aren't playing the same game?

God has spoken!

DownWithYogaPants's picture

These Jews must be supermen to be able to crack encryption faster than other people.  

Arnold's picture

Blythe got the trading algo going.

random999's picture

ethereum is new bitcoin 2.0. Soon starting to trade on btcc. Once the chinese start trading it will pass btc in marketvalue in no-time

Haole's picture

ETH is what Bitcoin was hoped to become before is was assimilated by Borgstream Kore.

Grave's picture

haha, hows your shithereum bags doing :D
falling like a rock, going down to 1 cent or lower where this overhyped bankster shit belongs

38BWD22's picture

 

 

At $500 I finally broke even.  :)

If you have time and inclination, sure, Bitcoin is worth a look for a small position.  It's interesting technologically and has potential to be a way to move capital...  I am in Peru now for instance.

But, I would not hold more than 1% of yoru net assets in BTC, I am not convinced that is uncrackable nor durable.

It is a Lotto ticket too.....

God's picture

GOD knows you bought north of $750 usd. GOD knows what you did. GOD remembers your excitement about the little coins.

God has spoken!

38BWD22's picture

 

 

Indeed I did start buying in the $700s!  Wow...  You already know that.

But, I bought moar as it went down.  Some of it when down near $300.  But, You knew that too.

Do me a favor, as Your calculation abilities are WAAAAYYY beyond mine: let me know what my Cost Basis is (for tax purposes, that render unto Caesar thingie...), the calculations would be very tedious and complex for me.

Thanks for all the prayers answered.

38BWD22's picture

 

 

Of course I'm just funning with the guy.  I already have a real relationship with the Real One.  

I do not hold that good-hearted humor = blasphemy (etc.).

God's picture

GOD knows you got run over by the bus. As we all witnessed. The cost-basis savior bus came back and nailed you too.

GOD says ZH is not a king maker but a muppet machine.

God has spoken!

OldPhart's picture

and God damned Zero Hedge.

It is written.

USisCorrupt's picture

It is not to late to enter Bitcoin for the possibilities are infinite due to the money printing by ALL Central Banks along with everything mentioned in this article. I have posted on here before about Coinbase which has a Very User Friendly platform which even allows you to obtain your own Shift Debit Card through Visa for real time purchases. It also offers a nice feature as to where you can store your Bitcoins offlne for an added layer of security.

I have supplied a link below for those who would like to open an account with Coinbase and in doing so will receive an extra $10 in Bitcoin when they fund their account with $100 or more. Remember Diversification is KEY. In the interest of full disclosure I too will also receive the $10 credit as well.

https://www.coinbase.com/join/55fade0681d9245e3300006f

Remember starting in July the amount of Bitcoins mined per month will go from 25,000 to 12,500 and there will never be no more than 20,999,999. There are currently just over 15,000,000 and the mining is not due to be final until the year 2140, hence the reason why Bitcoin is known to be a deflationary currency.

All the best and God Bless.

ZorroHedge's picture

A lotto ticket ? Are you for real ? Bitcoin is not hackable. I saw a video of this Greek guy explaining why it is not hackable. It will cost billion of dollars to try to hack it and anyone trying to hack it will be kicked out within a few minutes. So it will be 5 billion dollar thrown in the garbage. Also, because it is distributed as time passes by it only gets more difficult to hack into it.

The only problem bitcoin might have is scalability which could slowdown transactions. But even with this problemI see a bright future for bitcoin because it allows people to hide money from the government. Who cares that a transaction take 1 day if the main purpose is to hide money from the government and get out of the banking system so you are safe for bail-ins?

Prisoners_dilemna's picture

Another great video that talks about the cost to "hack bitcoin".

https://www.youtube.com/watch?v=ZloHVKk7DHk

Bitcoin 101 - Quindecillions and the amazing math behind Bitcoin.

 

Theres just not enough energy on earth.

Haole's picture

Whatever man, glad I could be an object for your egomaniacal expression of self.

If you consider it "hyped bankster shit", you have no idea how ETH and the DAO are meant to function apparently. 

Hyped?  For sure, it's crypto!  Look at you hype BTC in here, hypocrite much?

What makes you assume I don't still hold BTC myself and am also hedged, enjoying the casino?

Thanks for playing though, now back to your customary blather and ridicule...

Grave's picture

and overpumped using wash trading on shitty exchange by a group of clowns with sole purpose to increase their bitcoin holdings

i'm still laughing how these clowns miscalculated their pump and dump fraud, placing it right before bitcoin halving and then desperately tried to hold bitcoin down by shorting on chump exchanges, but once china started moving it blew up in their faces haha

of course i also trade altcoins to increase my bitcoin holdings but i dont go around preaching about "bitcoin 2.0" bullshit

bitcoin is bitcoin 2/3/4/n/etc, not some useless clown coin

Haole's picture

That's interesting that you get so much satisfaction from others' misfortune.  

Grave's picture

what misfortune, alts are extremely risky and should be traded very carefully

Haole's picture

Please keep in mind Mr. 30-something weeks, that I was extolling the virtues of BTC in here going on 3 years ago when there was 8 or 10 pages of utter malarkey to endure as a reward for trying so please don't BS me or troll me.  We're on the same side and you're no prophet in here, just the latest soapbox jockey.

 

Grave's picture

it just gets so mind-numbing reading all that hostile crap spouted by these "insert-latest-scamcoin-name" cultists and televangelists

Haole's picture

Watching the trollbox on Polo isn't healthy...  ;)

Grave's picture

yeah what a cesspool, but thats how its with all trollboxes :)

God's picture

GOD would like to see you two coinheads kiss and make up.

Haole's picture

We're fine without false idols certainly, thanks...

God's picture

I instruct you to put aside your petty differences and seek enlightenment from each others commonalities.

God has spoken!

Haole's picture

I instruct you to piss off.  You're not funny and a blasphemer.

God's picture

Take your coin drama over to one of your idiotic "smells like BTC spirit" sites.

God has spoken!

random999's picture

BTC and ETH are very similar except ETH is a further developed and more advanced and complete product.

You can name any crypto or fiat currency and call it a fraud, because in the end no currency more than silver and gold got any physical value. If internet shuts down they will all be worthless.

All cryptos have a big disadvantage not being backed by any government (except iceland) and also they are not easy to adopt to yet and not very widely accepted in societies. Yet they are global and they have some other great advantages too! Ask any chinese person who wants to get money out of his/her country!

Exactly, noone can control or stop your transaction. Noone can charge you extra to do. Noone can inflate your currency towards worthlessness by 50% for every 10 years as the global nationional currencies have in average over the past 100 years of time (not counting countries who had periods of hyperinflation).

As long as markets keep liquid you dont need all people to accept ethereum everywhere. All you need is an exchange where you can trade in your ethereum or bitcoins into local currency! You have them in europe, you have them in usa, you have them in china. So, lets keep on keeping the markets alive and liquid, for our own sake.

Im certain the main reason for some crytpoes having comet his far but still didnt reach the broader public is because people are too lazy and stupid to take a few minutes time to just trying to figure out what eth/btc really are and how to store it. Specially for people with very little/no understanding of computer and programming. This is something that the cryptosocieties need to work on to simplify for the average less knowledgeable user.

Condition 1SQ's picture

Be careful pinning your hopes and dreams to Chinese speculators.  I've ridden this roller coaster before.  They'll hump anything until it is a lifeless corpse and move onto the next coin.

OldPhart's picture

I, for one, don't understand the alternate currency.  To me you must be at least twenty years younger than me to understand it.

All respect and good luck to you.  but I'm pretty comfortable with my forty pounds of silver, 3.1 ounces of gold and .1 ounce of platinum.  All of which is in my personal possession

I've experienced power outages that lasted more than a few days.  How would you use bitcoin in a power outage situation?  I once traded two silver eagles for Canadian currency to go on the Maid of the Mist and have lunch.  How could bitcoin jump in in local personal transactions when in an 'emergency'?

ZorroHedge's picture

Ha. Stop the bitch fight. Just hold both BTC and ETH. Now give each other a little kiss and become best friends forever.

Prisoners_dilemna's picture

Until Andreas Antonopolous tells me Eth is safe I'm not going near it.

Til then I avoid it.

Mainly due to the fluff piece on coindesk.com written by ex-Goldman Sachs employee who now heads the Eth team.

Illuminatig's picture

You need to get updated. AA has been supporting Ethereum for a long time as an ETH miner and also has a recend DAO proposal.

ZorroHedge's picture

2 weeks ago I gained 35 % profit with ethereum in just a few days. If I would have sold earlier it would have been 50 %. So you can cry all you want about it, in the meanwhile people are making money of it.

random999's picture

lol making fake minusvotes, what do you hope to ger out of it?

 

reality is there some zerohedge commentary bashing wont make a difference.

Bangers's picture

First version of the lightning network on top of the Bitcoin network released 2 weeks ago with 100k tx per/s from the off. Keep up will ya!

JustUsChickensHere's picture

As I understand it, Lightning has yet to determine the design for the proposed fancy routing idea.

It is a good concept, and the guys looking at it are looking back at all the earlier work on location brokerage and OSPF (https://en.wikipedia.org/wiki/Open_Shortest_Path_First) ... I know how hard that stuff is - I built a real system for Telstra back in the 80's which had the same goals. It worked - but there were always issues.

Without the 'routing hubs', Lightning will not be optimizing many use cases - so the load reduction to support 100k throughput will not exist.

So far, the code released is just the prototype of what may improve things. Everyone is getting ahead of themselves.

 

 

Grave's picture

bitcoin = invention of wheel
shithereum = "invention" of square wheel

Condition 1SQ's picture

I think you'll be eating your words this year ..

Illuminatig's picture

Big brains in the Bitcoin space have been supporting Ethereum including Andreas Antonopolous (DAO proposal this week), Jeff Garzik, Erik Voorhees, Brian Armstrong and others. Regardless we still see pathetic idiots that think BTC must be the only successful crypto asset out there for the one and only reason that these idiots want to get rich by just holding BTC. Go back to r/bitcoin and leave smart discussions to open minded people.

Illuminatig's picture

you sound like a 12yo. Maybe you are and that is fine.

nomofiat's picture

Like most responsible investors, the chinese want to know how many Ether will be created before they jump on board.

Good luck to you if they stick to 24M ether created each year. right now the only guarantee you have is that it wont be more then 24.000.000 p/a.

Besides, it is already within reach of every chinese crypto trader.

Grave's picture

haha banksters tried to take over bitcoin's blockchain several times, with all hostile takeover attempts complete failures

because bitcoin is by design resistant to change and therefore resistant to hostile takeovers

war against banksterism:
1. first they ignored bitcoin - check
2. then they laughed at bitcoin - check
3. then they fight bitcoin - in progress
4. and then bitcoin wins - incoming :D

they FEAR bitcoin because its purpose is to escape the system of neo-feudalism through usury that exists via fractional reserve debtfiat currencies

from horse's mouth:
Paul Krugman's paper titled "Bitcoin is Evil":
"BitCoin looks like it was designed as a weapon intended to damage central banking and money issuing banks, with a Libertarian political agenda in mind - to damage states ability to collect tax and monitor their citizens financial transactions."